A security official at the scene said the suicide attack appeared to be aimed at two armoured cars, although it was not clear who was in the vehicles.
The tangled, flaming wreckage of one of the cars lay on its side, while dozens of fire fighters and police attended the scene.
“It was a crowded area. There are both civilian and security forces casualties,” said Najib Danish, a spokesman for the interior ministry.
He said the wounded had been taken to hospital but there was no word on fatalities.
There was no immediate claim of responsibility.
Kabul was already on high alert following last week’s attacks which killed at least 50 civilians and security forces personnel in the worst violence seen in the city in years.
The wave of violence comes days after a change of leadership in the Afghan Taliban, who announced the death of their founder, Mullah Mohammad Omar, late last month and named Mullah Mohammad Akhtar Mansour as their new leader.
However his swift appointment by a small council of leaders in the Pakistani city of Quetta has angered others in the group, causing rifts within the movement and adding to speculation that the latest wave of violence is linked to the leadership dispute.
The Taliban are seeking to re-establish their hard-line Islamist regime after they were toppled by U.S.-led military intervention in 2001.
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